— Vicki McKenna (@VickiMcKenna) May 26, 2021
https://www.axios.com/states-banks-drop-coal-warning-biden-carbon-278bb3fb-2254-41b2-9b94-f986c1c9a3d2.html?utm_source=newsletter&utm_medium=email&utm_campaign=newsletter_axiossneakpeek&stream=topMore than a dozen Republican state treasurers are threatening to pull assets from large financial institutions if they agree to decarbonize their lending and investment portfolios, Axios has learned.
Why it matters: The Biden administration — led by special presidential climate envoy John Kerry — has leaned on the banks to help reduce U.S. carbon emissions. That’s prompted GOP lawmakers to criticize efforts to “de-bank” fossil fuel firms. The treasurers collectively control hundreds of billions worth of assets.
- Fifteen of them, led by coal-heavy West Virginia, say they’re prepared to use this financial muscle to push back.
- The effort includes treasurers from other states with large energy industry presences such as North Dakota, Kentucky, Pennsylvania and Oklahoma.
- “We intend to put banks and financial institutions on notice of our position, as we urge them not to give in to pressure from the Biden administration to refuse to lend to or invest in coal, oil and natural gas companies,” the officials wrote.
- In an interview with Axios, West Virginia state Treasurer Riley Moore said he was prepared to terminate contracts with banks that pull back their fossil fuel industry lending in response to administration pressure.
- “Frankly, it is not fair for the people of West Virginia to allow a bank to handle our money when they’re diametrically opposed to our way of life,” Moore said.
What they’re saying: Moore called the issue “a matter of life and death for my people.”
- He said coal and gas operators in his state have reported difficulties obtaining financing from banks blaming pressure from the Biden administration to try to “green” their portfolios.
- “If you just cut these guys off at the knees — gas and coal in a state like West Virginia — and they can no longer conduct their business … it is going to destroy us,” Moore said. He cited the industries’ heavy jobs footprint and contributions to the state’s tax base.
- A State Department spokesman did not immediately respond to a request for comment.
Between the lines: The state officials signing the letter collectively manage more than $600 billion in assets in state treasuries, pension funds and other government accounts, according to publicly available financials and information provided by the state treasurer offices.
- Those states work with large financial institutions to invest and grow those funds, to support state spending and retirement payments to former workers.
- Even for sizable investment banks, such funds can be some of their largest accounts.
Republicans, at least at the state level, may finally be understanding that you don’t beat the left’s encroachments with virtue signaling. That includes the fight against the illiberal machinations of big business.
In the past, we’ve seen credit card companies and banks threaten to not process gun and ammo sales as a way to backdoor their political will without being accountable to voters via an election process. The next front in that battle involves the hysteria surrounding global warming. John Kerry, climate czar for the Biden administration, has been pressuring banks to stop lending to companies that deal with fossil fuels.
Now, Republican treasurers in 15 states are fighting fire with fire.
This is the right move. You are never going to convince a bunch of woke, left-leaning CEOs that they shouldn’t do something with faux appeals to principle. All they understand is financial pain, and every legal tool should be used to inflict it until they learn their lesson.
Fossil fuels are the lifeblood of our economy, and that goes far beyond just putting gas in people’s cars. Petroleum products are present in nearly every part of our lives, from energy needs to computer parts. Things like natural gas are also the chief driver in reducing emissions, which is ironic given that’s what the climate change adherents claim to care about.
Some conservatives, especially those who lean toward the libertarian side, will decry this move to punish companies for becoming overtly political in the service of Democrats. They will take the approach that any use of government pressure to stop the abuses of big business is somehow tyranny in and of itself. Those people can scream at the wall at this point because we’ve got real battles to win, not just debates inside think tanks.
Freedom does not become any less crushed if it’s private, big business doing the crushing. Trying to control people without their consent by using the power of large corporations is not capitalism. It’s cronyism. Republicans that recognize that will be equipped to fight the battles that are undeniably coming our way. Republicans that don’t should get out of the way because the rest of us aren’t content with being subjugated by the left under the guise of principle.